Deregulation Bill

Baroness Donaghy Excerpts

Monday 7th July 2014 Lords Chamber

[Baroness Donaghy (Lab)]

My Lords, it is always a pleasure to follow the noble Lord, Lord Cope of Berkeley. He will not need reminding that it was Moses who created the first 10 regulations.

My mother used to say, “Say something positive first, dear”, so this is my positive bit. I welcome the proposal in Clause 70 to clarify the role of the Director of Public Prosecutions under the Gangmasters (Licensing) Act 2004. Anything that strengthens the arm of the Gangmasters Licensing Authority’s work is to be welcomed. I believe firmly that its remit should be extended to cover the construction industry, as it is an area that is crying out for some protection for exploited workers. However, today I shall concentrate on two areas: Clause 1 on health and safety for the self-employed, and Clause 34 on short lets in London, which have already been referred to by the noble Lord, Lord Grade, and a noble Lord who is not in his place.

I will deal with the short lets in London first. If this measure is passed, and I profoundly hope that it is not, the unintended consequences will be detrimental to rich and poor alike. This is a strange gloss on the Prime Minister’s slogan that “We’re all in this together”. Take a settled residential block north of the river. All the residents are comfortably off, with security provided 24 hours a day. If this legislation is enacted, the sub-letters and online letting companies will march in. The premiums are such that you can make three times as much income as you can from ordinary longer-term lettings. Even if we disregard the diminution in housing stock in London, which is already at crisis point, the health tourists would move in and out with their families, treating the place like a hotel and an A&E department combined.

If you are really unlucky, the prostitutes and housing benefit fraudsters will move in, while at best it will become a temporary residence for overseas businessmen and their families, who are often no respecters of other people’s property or peace of mind. The residents will experience an increase in unauthorised rubbish dumping—and flooding, if they live in flats below the temporary residence. By the way, it will be virtually impossible for the fire authorities to keep track of this. The nature of the residential block will change and there will be nothing that the majority of residents can do about it. They in turn will be tempted to move in order to escape the disruption when temporary letting becomes the norm in that block of flats. To my knowledge, this is already happening at the margins.

As the noble Lord, Lord Tope, said, the British Hospitality Association, the Bed and Breakfast Association and many others have sent submissions about this clause. Westminster City Council has provided an excellent briefing as well. That council has done a sterling job in fending off the marauders. Yes, I am praising a Conservative council. All those bodies are saying the same thing: the proposed change will pave the way for largely unregulated short-term online rental companies to operate more freely in London and remove the main mechanism by which regulators currently have the chance to ensure the safety of the public. The largest of these online companies, Airbnb, has over 23,000 premises in the UK for paying guests—premises which do not comply with government guidelines on fire safety.

Other cities in the world are striving to adopt the same controls that we are about to throw away. Paris, New York and Singapore have experienced housing inflation and anti-social behaviour in residential neighbourhoods. Westminster City Council has dealt with 7,362 enforcement cases in the past 15 years, equating to nearly seven years’ housing supply. In fact, this proposal is so unpopular, I think it must have been cooked up at the same dinner party as employee share ownership and the abolition of 100 year-old health and safety legislation on strict liability.

I turn to the proposal in Clause 1 to exempt the self-employed from health and safety law if they are not on a prescribed list. The Government claim that they are following a recommendation by Professor Lofstedt, but that is only partially true. The professor must be rather bruised by his encounters with this Government. He makes a recommendation that is circled about with conditions and caution, and it is snatched by this Government like a hungry child wanting a liqueur chocolate—of course, they will be able to have liqueur chocolate fairly soon. Professor Lofstedt indicated that any exemption should be for those,

“whose work activities pose no potential risk of harm to others”.

The Minister for Government Policy, Oliver Letwin, said that,

“about two thirds of the people in the country who are self-employed will no longer be covered by the Health and Safety at Work etc. Act”.—[Official Report, Commons, 3/2/14; col. 41.]

That really gives the game away, doesn’t it? It is a sad day when we mark the 40th anniversary of that Act in this way.

It is also regrettable that the Institution of Occupational Safety and Health was dismissed by the Solicitor-General as an organisation of “consultants”. I know that IOSH has written to correct this but it should be remembered that it has a royal charter and 44,000 members worldwide and is recognised by the ILO. It is a distinguished and knowledgeable organisation and is severely concerned by this clause. It deserves to be listened to.

The current draft of prescribed activities, produced very late in the day, includes construction, which I know a bit about. I am not reassured. I make it clear that I am not referring to the large construction companies, which are seized of the business case for a healthy and safe building site. It is the refurbishment industry, which is notorious for recruiting underskilled workers and for accidents. What happens if an employer informs his workers, who may be bogus self-employed, that, “This is not a building site so we’re exempt”? They are desperate for work and will take what they are given. Will the Government make it clear what is and what is not a building site? Is scaffolding around a house or a trench dug in the garden to be covered by the word “construction”? Are self- employed plumbers, electricians and carpenters covered in domestic housing? If not, how will the householder be alerted?

It is estimated that 90% of construction workers in London are self-employed or bogus self-employed. There is a worrying proportion of cowboys operating in London: small operators who know that there is a slim chance that they will be inspected by the HSE and who will exempt themselves from the prescribed list with little or no comeback, so there is an increased risk premium in London for workers and the public.

I remind the House that we kill 50 construction workers a year in accidents at work, let alone serious injuries and the scandal of unreported accidents. In addition, 32 construction workers die every week of lung-related diseases, and that figure is going up, not down. If three-quarters of the self-employed are to be exempt, as Oliver Letwin says, this must include some construction and allied workers.

The current Health and Safety at Work etc. Act is simple and easily understood. Everyone knows where they stand. Creating a prescribed list will cause confusion and encourage the cowboys.